The Old Man and the Sea.
The Old Man and the Sea is one of Hemmingway’s best novels. Santiago, the main character in the novel, is an aging fisherman who has gone for a long stretch without catching any fish. It had been over eighty days since he was able to land a fish so he decided to try his luck far from the shores of Cuba. He ventured out on his own and was rewarded with a catch of a lifetime by hooking a humongous marlin. It was so big it took over two days for him to bring it in close enough for him to kill it with a harpoon. The fish was too big to fit in the boat so he tied it to the side and headed back to shore. On the journey home a number of sharks attacked his marlin. He was successful in fending off a few sharks but not all. By the time he returned home the marlin had been eaten to the bone.
Santiago was patient and goal oriented. Even though he was in a fishing slump he had a plan to land his big fish. He was going to fish alone far from the shores of his normal fishing spot. He revised his old plan and took more risk to reach his goal.
What can you learn from Santiago?
Patience. In buying stocks it pays to be patient. It’s possible the stock you just purchased will not advance for some time. It could be days, months or years before your stock holdings show promise. It’s important to give your stocks time to flourish.
Goals. It’s paramount to have investment goals especially when buying stocks. Do you want to retire early? Buy a new home? Travel the world? Help others? If you write your dreams down, they are more likely to come true.
Plan. Santiago had a plan and so should you. Your plan will guide you to where you need to be in order for you to reach your goals. A thoughtful plan is the starting point for your future financial success.
Risk. You can’t catch any fish on land. Santiago had to take more risk in order for him to catch his fish. You may need to take more risk as well. It will be challenging to grow your wealth if you have most of your assets in cash, CD’s or short term bonds. Stocks are needed for the long term growth of your wealth.
Perseverance. It took Santiago two days to land the marlin. He didn’t give up on his goal amidst his struggle. At times, the stock market does not cooperate and you need to have fortitude to stay the course. Your stocks will go down and be attacked by haters and naysayers but you have to hold on especially if you have conviction in your investment strategy.
Goals, planning and perseverance can help you be a successful investor. When your stocks are in a holding pattern think about Santiago and his battle with the mighty marlin.
For he and all his companions were astonished at the catch of fish they had taken. ~ Luke 5:9.
Bill Parrott is the President and CEO of Parrott Wealth Management, LLC. www.parrotwealth.com.